Green Energy: Bootleggers, Baptists & Politicians

A version of this article appeared in the Clayton News.

Got on your green-tinted lenses? Over the coming months, you’re going to need them. More stories about various new facilities being constructed around the state make for good ink. You may have already read about the Fibrowatt turkey-waste plant slated for Stanly County. Or the ethanol plant in Raeford. There are more coming. What do they have in common? They’re zombie industries created by coalitions known as “Bootleggers and Baptists.” Wait a minute — Zombies? Bootleggers? Let me explain.

Zombie industries are companies that don’t really exist in the marketplace. In other words, but for subsidies, corporate welfare, and energy regulations, they would never be born. You might say they’re animated by government in the manner of Frankenstein’s monster. That’s okay, say those officials who write “incentives” checks and craft the legislation, because these companies “create jobs” and abate global warming. But do they create jobs? Do they help the environment? Not exactly.

But first, I promised you an explanation about Bootleggers and Baptists. You see, during Prohibition, Baptists were standing in the picket lines in the name of temperance. But they weren’t alone: beside them – with apparent sanctimony – were the bootleggers. That seems strange on its face, but it makes sense. During prohibition, bootleggers made very high profits on their illicit activities – despite the risks of getting caught. Why? Their (legal) competition disappeared due to the regulation. Bootleggers didn’t want to see the regulations repealed, because their monopoly profits would dry up. So the Bootleggers and the Baptists made strange but effective bedfellows. Add politicians to this ménage-a-trois and you’ve got the recipe for political power fueled by special interests and righteous indignation.

Today’s Bootlegger-Baptists coalitions aren’t concerned so much with alcohol—unless you consider all the subsidy of corn liquor (ethanol). No, today’s “Baptists” are environmentalists. Today’s Bootleggers are green companies, so-called “stakeholders” spending millions to lobby the N.C. General Assembly (and Congress) to craft legislation they’ll benefit from. Even companies like Duke Energy have gotten in on the green-washing. After all, they stand to win big in a carbon tax environment against their oil and coal competitors, given their holdings in nuclear and natural gas.

So the next time you hear something negative about Big Oil, remember Big Corn, Big Gas and Big Green. Of course, Bootlegger-Baptist coalitions arise to ensnare politicians. If politicians didn’t give these special interests what they want, the former wouldn’t get campaign contributions and political anointing. But more importantly, elected officials wouldn’t be able to hide behind the moralistic rhetoric of environmentalists (Baptists), even though their prescriptions almost always benefit the special interests more than the environment.

Which leads us back to the question: Do green subsidies in North Carolina create jobs or protect the environment? I am reminded of a quote by Rep. Prior Gibson (D-Anson), who said: “I’m positive it’s in our best interest to keep XYZ company with 1,000 jobs, even if they’re making buggy whips.” So it’s good to create jobs by extorting tax revenue from you and me to shower on companies that make things people don’t value? Staggering logic. Let’s see if we can apply it: Perhaps we should start building pyramids? A temple to Randy Parton? How about we hire teenagers to break windows on Main Street, then hire glassmakers to fix them? Won’t all these activities “create jobs”? The problem with the rhetoric of job creation is that it doesn’t take into account all the invisible costs borne by everyone else. Concentrating benefits and dispersing costs works great if you’re goal is to get votes in your district. But if leaders really wanted to develop our state’s economy, they’d be focusing on creating a hospitable business environment and an up-to-date infrastructure.

So what about the environmental benefits? Isn’t the payoff of all these green-business boondoggles a world that’s cleaner and greener? When it comes to ethanol, the environmental impacts could very well be worse than with fossil fuels. In a brief I coauthored with H. Sterling Burnett of the National Center for Policy Analysis, we found that ethanol diverts natural lands like rainforests to agricultural use, reduces fuel economy, pollutes the air with known carcinogens, and corrodes underground storage tanks. In terms of global warming, even if we converted 100 percent of our vehicle fleet to ethanol, we still wouldn’t slow warming by any appreciable degree—particularly since it currently takes more energy to make ethanol than it generates. I’m not sure about turkey-poop turbines—but then again, if it made economic sense, Fibrowatt wouldn’t need lobbyists in Raleigh. At this stage, if we – not a natural cycle – are warming the globe, we’d probably be better off simply adapting than building all these gilded silos to the Volcano God.